Indian travel agents expand their horizons

Indian travel agents are diversifying into other tourism-related businesses and increasing service charges to make up for the scrapping of commission payments by most of the international airlines.
Three thousand travel agents licensed by the International Air Transport Association (Iata) and 50,000 non-Iata licensed agents in India strongly opposed the introduction of the zero commission system. Until recently, these travel agents accounted for 85 per cent of bookings in the country but most airlines are now concentrating on online sales.
Commission rates were progressively reduced from nine per cent to seven and finally to five before being eliminated entirely.
The Travel Agents Association of India (Taai) has approached India's Director General of Civil Aviation to resolve the dispute with major airline companies and a final decision is expected soon.
"There has been a 30 per cent drop in business due to the airlines' zero commission rules," NM Sharafudeen, Chairman of the Kerala Chapter of Taai, told Emirates Business.
"Most of the agents are trying to compensate for the loss of business by focusing on package tour sales and other related businesses," he said.
Air traffic from the Gulf countries to Kerala is at its peak in the summer.
Vinay Nambiar, Area Manager for the UAE, Oman and Qatar at Kingfisher Airlines, said most carriers serving routes between the Gulf and India had abandoned agency commission and switched to internet booking.
In India agents are diversifying into hotel bookings, ground handling, holiday packages and sightseeing to earn commission.
Travel agents in the UAE are working on a zero commission basis.
A travel agent in Deira said the change to zero commission had affected business but the number of passengers remained high during the summer season.
Agents in India previously saw business boom in the summer as Indian expatriates rushed back home and ticket rates skyrocketed. Now major agencies are boycotting Singapore Airlines in protest against the ending of commission payments and have stopped promoting Singapore as a tourist destination.
29/06/09 VM Sathish/EmiratesBusiness 24-7, UAE

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Categories: Indian Aviation- In General Jun 2009